FIG. 1 is a block diagram that illustrates a conventional payment system 100.
The system 100 includes a conventional payment card/device 102. As is familiar to those who are skilled in the art, the payment card/device 102 may be a magnetic stripe card, an IC (integrated circuit) card, a fob, a payment-enabled smartphone, etc. The payment card/device 102 is shown being carried and used by an account holder/user 103.
The system 100 further includes a reader component 104 associated with a POS terminal 106. In some known manner (depending on the type of the payment card/device 102) the reader component 104 is capable of reading the payment account number and other information from the payment card/device 102.
The reader component 104 and the POS terminal 106 may be located at the premises of a retail store and operated by a sales associate of the retailer for the purpose of processing retail transactions. The payment card/device 102 is shown in FIG. 1 to be interacting with the reader component 104 and the POS terminal 106 for the purpose of executing such a transaction.
A computer 108 operated by an acquirer (acquiring financial institution) is also shown as part of the system 100 in FIG. 1. The acquirer computer 108 may operate in a conventional manner to receive an authorization request for the transaction from the POS terminal 106. The acquirer computer 108 may route the authorization request via a payment network 110 to the server computer 112 operated by the issuer of a payment account that is associated with the payment card/device 102. As is also well known, the authorization response generated by the payment card issuer server computer 112 may be routed back to the POS terminal 106 via the payment network 110 and the acquirer computer 108.
One well known example of a payment network is referred to as the “Banknet” system, and is operated by MasterCard International Incorporated, which is the assignee hereof.
The payment account issuer server computer 112 may be operated by or on behalf of a financial institution (“FI”) that issues payment accounts to individual users. For example, the payment account issuer server computer 112 may perform such functions as (a) receiving and responding to requests for authorization of payment account transactions to be charged to payment accounts issued by the FI; (b) tracking and storing transactions and maintaining account records; (c) rendering periodic account statements; (d) receiving and tracking payments to the issuer from the account holders; and (e) clearing transactions.
The components of the system 100 as depicted in FIG. 1 are only those that are needed for processing a single transaction. A typical payment system may process many purchase transactions (including simultaneous transactions) and may include a considerable number of payment account issuers and their computers, a considerable number of acquirers and their computers, and numerous merchants and their POS terminals and associated reader components. The system may also include a very large number of payment account holders, who carry payment cards or other devices for initiating payment transactions by presenting an associated payment account number to the reader component of a POS terminal.
In an important market for payment account transactions, a significant shift is now taking place in terms of the actions taken at the point of sale in connection with a typical payment account transaction. In this market, until fairly recently, most account holders carried magnetic stripe payment cards and most merchants permitted their customers to load the account information and so forth into the point of sale card reader 104 via swiping the magnetic stripe of the payment card through a magnetic stripe reader (not separately shown in FIG. 1) that was part of the reader 104. However, in an initiative to combat payment account fraud and deter counterfeiting of payment cards, new arrangements among the parties to payment account transactions have arisen, such that magnetic stripe “swipe” transactions are no longer encouraged. Instead, card issuers are generally issuing payment cards that are IC cards and that have electrically conductive contact pads on the front surface of the cards. Via these contact pads, a “contact interface” on the reader 104 allows for exchange of data communications between the POS terminal 106 and the integrated circuit in the contact IC payment card. The exchange of data communications between the POS terminal 106 and the IC card typically follows a standard protocol for such exchanges of data. As the above-noted shift takes place, chip-card contact reading is increasingly occurring at the point of sale rather than a magnetic stripe “swipe.”
One issue that has arisen is that these contact or “chip” transactions at the point of sale either consume more time than the previously prevailing “swipe” transactions, or at least are perceived to take more time. It is of course in the interest of both card holders and merchants that point of sale transactions be completed (and are perceived to be completed) promptly.